Annuity Payments - Understanding Annuity Payments
Typically when an individual is awarded a structured settlement for
personal injury, etc., their attorney and the payer's insurance company
negotiate a settlement that is based on the insurance company purchasing
an annuity. The annuity payments are paid-out in a combination of
principal and interest over a long period of time and commonly on a very
restrictive schedule of disbursement. This type of annuity is known as a
non-assignable annuity that is funded by a single premium.
The non-assignable annuity is purchased to provide a predetermined
annuity payment stream to the payee as a result of the lawsuit. The
purchasing of this type of non-assignable annuity typically does require a
judicial review. The judicial process usually will determine the length of
time it takes to purchase these types of annuity payment streams. In
actuality, an individual may not receive their first "annuity payment" for
about 6 to 8 weeks, sometimes longer.
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